The president of the National Hotel & Restaurant Association, Ramon Prieto, has repeated that the nation’s 52,000 hotel rooms are enough. He said the country should go two or three years without adding another hotel room. Prieto says that income levels of the hotels declined 10-15% during the first trimester of the year, reflecting the increase in taxes that went into effect in January. He said the hotels have had to absorb the taxes, not being able to pass them on to tour operators that have already published their prices for summer of this year. Thus hotel profitability is down. Prieto said he is optimistic that private sector and government efforts to increase the number of US travelers will pay off. European travel is affected by a decline in the value of the European currency in relation to the US dollar, making Dominican holidays more expensive for Europeans. Furthermore, Prieto explains that hotel occupancy is only around 70%. The excess supply is pushing rates down. (4 May 2001)
